Topsham woman sentenced for using brother-in-law’s vets benefits to remodel house

PORTLAND, Maine — A Topsham woman was sentenced Thursday in U.S. District Court to a year of incarceration for misusing tens of thousands of dollars from her brother-in-law’s veterans benefits account.

Marsha Jacobs, 65, was ordered to serve six months of her sentence in prison and six months of the sentence confined to her home, according to the U.S. Attorney’s Office.

In addition to incarceration, U.S. District Judge Nancy Torresen ordered Jacobs to serve three years of supervised release and to pay nearly $93,000 in restitution. The defendant is scheduled to begin serving her sentence Aug. 19.

“My client is very remorseful for what she has done and wants to make it right,” defense attorney Patrick Parson of Damariscotta said in a telephone interview after the sentencing.

In 2003, Jacobs was appointed the fiduciary of benefits from the U.S. Department of Veterans Affairs to her brother-in-law, according to the prosecution version of events to which she pleaded guilty earlier this year. By pleading guilty to misappropriation by a fiduciary, she admitted to using the money to remodel and expand her home in Nobleboro.

Parson said in his sentencing memorandum that in 2003 the defendant’s brother-in-law, a disabled Korean War veteran, began living with her. Three years later, Jacobs decided to have an apartment built on the back of her home for him with a small living space and office upstairs.

As a contractor began work, Ameriquest, the company through which Jacobs had obtained the promise of a home equity loan, began to fail, according to Parson’s sentencing memorandum. She never received funds from the firm and was unable to obtain a loan from other financial institutions, so her brother-in-law offered to lend her the money to complete the project.

“Between July 2006 and February 2007, [Jacobs] depleted thousands of dollars from [his] fiduciary accounts to keep up with the remodeling expenses,” the attorney wrote. “Once the fiduciary account reached a balance near zero, it never recovered. Ms. Jacobs continued to fund the ongoing construction primarily using her own credit cards, her own income and the revenue from [his] benefits. Even after the project was completed, Ms. Jacobs continued to pay off the massive credit card debt that she amassed during the project using moneys entrusted to her on behalf of [her brother-in-law], among other moneys.”

She reported her misuse of the money to the VA in April 2010 and requested that someone else be assigned to manage her brother-in-law’s benefits and finances. Jacobs was charged in December 2011.

Until a new guardian was found for the man in August 2011, he lived in the apartment at Jacobs’ home rent-free, according to the sentencing memorandum. She paid his cable television and utility bills and cared for him without compensation for more than a year.

Jacobs faced up to five years in prison and a fine of up to $250,000. Under the prevailing federal sentencing guidelines, the recommended sentence was 12-18 months, Assistant U.S. Attorney Halsey Frank, who prosecuted the case, said Thursday after the sentencing.

Parson, in his sentencing memorandum, urged Torresen to go outside the guidelines and sentence Jacobs to six months of incarceration with three months to be served in a federal prison and three months to be served as home confinement.